Deregulation and Access to Medicines: the Peruvian Experience

How does the deregulation of medicine influence access to drugs? This paper provides an economic policy assessment of the effects of medicine deregulation drawing on the Peruvian experience between 1991 and 2006. As in other low‐income countries, health insurance development is inadequate, drug expenditure is mostly paid out‐of‐pocket and approximately one third of the Peruvian population has limited access to ‘essential medicines’. Market deregulation in this context could have exerted an impact on prices and hence reduce access to medicines. Based on this evidence, we find that product and price deregulation of the medicines market appears to have reduced consumer trust of locally produced medicines and incentivised a switch to branded and more expensive drugs. The latter resulted in a drug price spike, which in turn further decreased access to medicines. Copyright © 2015 John Wiley & Sons, Ltd.